IBON Foundation
Overall inflation and food inflation are at their highest this year, hitting the poorest Filipinos with meager incomes the hardest, said research group IBON. The continuous rise in prices since the start of the year, with a significant surge in July 2024, highlights the failure of government efforts to control inflation and bares the emptiness of their repeated claims of success.
The Philippine Statistics Authority (PSA) reported faster July 2024 inflation for all income households at 4.4% from 3.7% in June 2024. This is the highest inflation for the year, after steadily increasing since 2.8% in January. Higher electricity rates, more expensive meat and fruits, and oil price increases were the main drivers.
It is worse for the bottom 30% of income households — for them, inflation rose from 5.5% in June 2024 to 5.8% in July 2024. This is also the highest this year and has been on the rise since the 3.6% in January. The faster inflation was also mainly driven by the same commodity groups as with all income households.
IBON noted that July 2024 food inflation is also the worst this year for all income groups. Food inflation was 3.3% in January, rose to 6.5% in June, and is already at 6.7% in July. Meanwhile, for the poorest 30% of Filipino families who spend half of their meager incomes on food, food inflation was 5.3% in January, rose to 8.4% in June, and is up to 8.7% in July.
Unabated inflation further burdens Filipinos who have been struggling to cope with high prices amid stagnated wages and persistent poverty, the group said. IBON estimates that the nominal average minimum wage across all regions of Php444 is only a little more than one-third (36.5%) of the Php1,215 family living wage (FLW) that a family of five needs.
Also, contrary to Pres. Marcos’ claim during his state of the nation address (SONA) that poverty is decreasing, self-rated poverty has been increasing since January along with worsening inflation. According to the Social Weather Stations (SWS), the number of self-rated poor families grew from 13 million in December 2023 to 16 million in June 2024. There were also 18.5 million Filipino households that are without savings as of second quarter of 2024.
The deteriorating state of poor and vulnerable Filipinos makes wage hikes all the more urgent, IBON said. But instead of mandating substantially higher wages, the Marcos administration has only given token amounts, like the Php35 minimum wage increase in the National Capital Region (NCR).
IBON said that the Marcos administration has repeatedly failed to arrest high prices of goods and services. Higher wages are crucial amid widespread and chronic poverty to ease Filipinos’ burdens in the short run.
In the long run, government should ensure that basic needs, especially food and essential utilities, are affordable and in sufficient supply. This is most possible by developing the country’s capacity to produce these without having to depend on imports and external sources, said IBON.
